As Microsoft prepares its critical update for its Windows 8 platform, the company has become the target of a lawsuit alleging that the software giant misled investors regarding both Windows RT and the Surface RT device that was released last year. The lawsuit is a class action complaint filed in the United States District Court for the District of Massachusetts. The complaint accuses Microsoft of violating the federal securities laws with misinforming investors of the progress the Surface RT tablet had made since its release late last year.

According to the filing, Microsoft “led the market to believe that [its] launch of the Surface RT had been executed in a measured and conservative fashion so that it could observe and understand its progress and outcome.” Instead, the suit calls the Surface RT launch “an unmitigated disaster, which left it with a large accumulation of excess, over-valued Surface RT inventory.”

The suit goes on to state that Microsoft issued "materially false and misleading financial statements and financial disclosures" regarding the financial impact that the Surface RT’s underperformance was having on the company. Microsoft ended up writing down $900 on the failed service at the end of the most recent quarter and the company’s stock plummeted from $4.04 per share (roughly 11.4%), eliminating about $34 billion of Microsoft’s market value. The suit continued by naming a number of Microsoft’s executives as defendants, including CEO Steve Ballmer and CFO Peter Klein. According to the filing, the individual defendants “are liable as participants in a fraudulent scheme and course of conduct that operated as a fraud or deceit on purchasers of Microsoft common stock” due to their sharing of information the suit deems as “false and misleading,” as well as their supposed “concealment” of other information.

For those of you who don’t know much about Windows RT, it is a pared-down version of Windows which is meant to run on ARM-powered devices. It was meant to give Microsoft a foothold in the low-power device market and serve as competition against Apple’s dominance in the segment. Instead, the operating system ended up debuting to consumer confusion and Microsoft has been struggling to generate interest since. The full-powered counterpart, Windows 8, has seen a little bit more luck but consumers still tend to opt for Android or iOS-powered tablets and smartphones instead. Microsoft recently announced that the long-awaited update would arrive on October 17 as Windows 8.1. The update is said to give consumers the option to bypass Microsoft’s “Modern” touch-centric interface in favor of the more familiar desktop layout.

The Surface RT failure is in many ways similar to that of Research in Motion’s (now BlackBerry) PlayBook tablet. After the release of Apple’s iPad in 2010, RIM attempted to roll out its own tablet device in order to capture a portion of that segment. The PlayBook sold just half a million devices in its first quarter of availability, a quarter-million in the quarter after that and 150,000 in the quarter following. RIM eventually ended up taking a write-down of $485 million on unsold inventory and the company has been left reluctant to re-enter the tablet market since. Microsoft has been thought to have sold a bit over 1.5 million of units in total of its entire Surface line, which includes both the Surface Pro and the Surface RT. Although the software giant hasn’t released a detailed breakdown of Surface device sales, the majority of that 1.5 million is believed to consist of Surface Pro sales.

It's a relevant story as they compare it directly to the iPad in the commercials. If it was a story on drinking straws you would be right to complain.

Besides there are so many windows fan boys here to slam Apple products it just makes sense.

Exactly. Those regard this site are being a "Pro-Apple news site" are actually forgetting that this isn't a site that exists to glorify Apple based products, but rather it's about technology, the hacking and modifying thereof (the sort of thing that Apple doesn't want you doing) that happens to be Apple centric, but that doesn't mean the news portion is limited just to that. Being a technology site, it can be good to talk about what comparable products there are, rather than just one line of products, would might be fine if this were apple.com. Being a third party site that isn't affiliated with one company or another also gives it the freedom to be diverse in the information that is presented. In other words, news like this helps people get more well rounded information rather than just one side of it.